A customer enters the closing down Sears store
A customer enters the closing down Sears store is shown in downtown Vancouver, British Columbia, September 13, 2012. Reuters/Stringer

Canadian consumer confidence is getting affected by issues of personal finances and prospects in the job market. In recent times, such blues have affected Canadians in the Prairies and Ontario. Elsewhere in the country, Canadians are plodding along and hoping for the best. The latest survey conducted by Conference Board of Canada showed a three-month decline in consumer optimism in two regions, on the back of uncertain economic environment and inconsistent performance within the country.

The Ottawa-based think-tank said its consumer confidence index plummeted to 82.7 in November, down 1.4 points from October and 5.2 points from September. But the survey noted that the drop in confidence has not been uniform. The drop was massive in the Prairie region's index.

Stating this, Todd Crawford, the Conference Board's senior economist said, Ontario was the only other region to register a decline as other regions rebounded from October's poor showing. Consumer sentiments in the Prairies dropped 13.6 points in the November survey, and in Ontario it fell by three points. The biggest improvement was in Atlantic Canada, where optimism was up by 10.7 points, and in Quebec, it rose 4.9 points. At British Columbia it improved by 2.4 points, reported Business Financial Post.

Time To Buy

Surprisingly, the Conference Board survey showed most Canadians thinking that this is a good time to make major purchases, such as cars or homes. A positive response to that issue was 42.6 percent, up from 41.4 percent in October. The rationale for buying more assets seems to be emanating from the recent drop in global oil prices, and the downward pressure on gasoline prices.

This week, the Bank of Canada will be issuing the latest interest rate decision, and many policymakers expect a lot of data crunch. The central bank governor Stephen Poloz may adjust its rate statement to reflect the increased risks of developments in the economy and consumer price levels. Charles St-Arnaud, an economist at Nomura Securities in London, noted that the growth and inflation data have been stronger than the BoC expected in the October Monetary Policy Report, but the decline in commodity prices and its persistence could become a drag on the economy.

Marginal Gain

Meanwhile, Bloomberg reported a marginal hike in Canadian consumer confidence in the week that ended on Nov 28, as it showed sentiments on personal finances rising to the highest level in more than a month. The Bloomberg Nanos Canadian Confidence Index jumped to 58.0 in the week that ended on Nov. 28, up from 57.4 in the previous week. The sub-indices tracking the economy and real estate also shot up, while the sentiments about job security showed a real drop.

Bloomberg said consumer confidence is hovering around the 12-month average, and mixed signals are coming out about the strength of Canada, which is world's 11th largest economy. Canada's output grew faster, but growth slowed in the third quarter, compared to the second quarter's 3.6 percent pace. Bank of Canada Governor Stephen Poloz has been insisting on a shift to growth powered by exports and business investments for erasing the economic slackness, the report noted.